Telnyx fined for failing to curb SMS scams, mobile number fraud

Thursday, 21 December 2023 10:55

Telnyx fined for failing to curb SMS scams, mobile number fraud Featured

Telnyx Australia has paid $106,560 infringement notice after the Australian Communications and Media Authority found the telco failed to reduce scam SMS and prevent mobile number fraud between 2017 and 2022, breaching anti-scam and public safety obligations.

The ACMA’s investigation found the business allowed at least 4,666 SMS to be sent using text-based sender IDs (i.e. shortened business names) without sufficient checks to ensure they weren’t scams.

ACMA chair Nerida O’Loughlin claimed Telnyx’s systemic failures had left its customers and the broader community at risk of harm over a lengthy period.

O’Loughlin said being a smaller telco is no excuse to breach the rules.

“Telnyx’s breaches weakened the application of anti-scams rules at a time when scam SMS have heavily impacted on many Australians,” she said.

Telnyx also not undertake adequate ID checks for its prepaid mobile customers or when transferring customers from other telcos.

The ACMA noted Telnyx also failed to give customer data to the Integrated Public Number Database (IPND) on more than 3,256 occasions between 2017 and 2022.

The IPND is used by Triple Zero to help locate people in an emergency, for the Emergency Alert Service to warn Australians of emergencies like flood or bushfire, and to assist law enforcement activities.

Telnyx is not the only telco having issues with the IPND. Last November, the ACMA fined Telstra $300,000 for failing “to provide accurate details of thousands of customers” to the national registry.

The penalty follows a $2.1 million fine in 2021 when the ACMA found systemic issues with Telstra’s IPND rules.

In addition to the financial penalty, the ACMA has directed Telnyx to comply with the Reducing Scam Calls and Scam SMS and the Integrated Public Number Database Industry codes.

Telnyx said it will conduct an independent review of its compliance practices and make improvements where needed.

“We expect new telcos to be compliant with industry rules from day one of their operations, including anti-scam and public safety rules,” O’Loughlin said.

“Protecting their customers should be the highest priority of all telcos, regardless of their size or how long they have operated,” she said.

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